Healthcare giant GSK today pressed the button on its £70 billion break-up with plans to put up for sale its global corporate headquarters in west London.
The announcement is a significant step in a four-year odyssey to carve the drugmaker’s empire into two separate listed FTSE 100 companies.
About 800 employees working for the consumer healthcare division will move from GSK House in Brentford to a new £120 million campus in Weybridge.
They carry with them nine power brands including Sensodyne, Aquafresh, Nicorette and Panadol, whose annual revenue of £10 billion will form the basis of the standalone company.
Plans for the new campus are being submitted to officials in Surrey this week. The employees will work in the nearby temporary offices till it is built.
The process of appointing a chair to assemble a board for the demerged firm under designated CEO Brian McNamara is underway.
The remaining 3500 employees will stay at GSK House – a historic tower opposite the M4 – for at least two years as a search is launched to find smaller offices nearby.
After the split, he would work for New GSK, a dedicated pharmaceuticals and drug research firm.
Affected employees of the FTSE 100’s sixth-largest company that employs 70,000 people worldwide were being informed about the move this morning.
GSK has long been under pressure for its underperforming drug pipeline and share price.
CEO Emma Walmsley intends to lead the new biopharma business to restore its reputation as a world leader in vaccine and immunology research.
New GSK has set a target of 5% sales growth and 10% growth in profits by 2026, aiming for £4.7 billion in revenue by the end of the decade to offset the impending loss of exclusivity on a slew of blockbuster drugs. 33 billion target. -One year HIV inhibitor dolutegravir.
Sources say that although the announcement was being made before the alternate offices were identified, the timing is in line with Walmsley’s schedule published three years ago.
It comes days after an updated call between GSK chairman Jonathan Symonds and investors, where Gordon Singer, head of the London office of apprehensive hedge fund Elliott, is said to have pressed for acceleration.
Elliott and Bluebell, another active investor, have both questioned Wolseley’s suitability to run a biopharma unit, given his non-science background, and called for an alternative.
He has also pushed for the group to be more open to outright sales of the consumer division.
GSK House was built at a cost of £315 million and was officially opened in 2002 by then Prime Minister Tony Blair.
McNamara said: “Today’s announcement is an important step as we prepare to part ways.”